When Shipping is Included it is Not Free

This post is an explanation of the shipping policy for my shop on Etsy.  This is not a rant about Etsy, I promise. The bottom line is this: If you see an item in my shop marked “free shipping” that means you will not pay any shipping cost for that item.  I have not included the cost of shipping in the item price. I cover the postage fees at my own expense. Only select items – mostly earrings – are shipped postage-free. For the items not marked “free shipping” you are charged the actual cost of postage based on USPS rates for the package size, destination, and type of service. I no longer ship outside the US and do not offer priority mail express upgrades.  Read on to learn why.

Why am I telling you this?  If you’re an Etsy seller, you’re probably aware that Etsy has been encouraging sellers to offer “free” shipping for some time.  If you’re not a seller, but are someone who shops on Etsy, you may not have been aware of this effort. Consider this blog post also a “buyer beware” announcement about what this “free” shipping campaign might actually cost you.

The pressure is on

The latest installment in this “free” shipping campaign by Etsy is their announcement that beginning July 30th items marked “free shipping” or from shops that guarantee “free” shipping on orders of $35 or more will receive priority placement in search results.  The converse of this is, of course, that items which do not ship “free” will be de-prioritized in search results. In other words, they’ll be at the end of the search results or otherwise less visible to shoppers.  That’s not where any seller wants to be so there is some pressure to get onboard.

Graphic from Etsy with my emphasis added in red.

No such thing as free shipping

Why have I placed scare quotes around the word free in reference to shipping?  Because it is not truly free. As far as I know, there are no shipping companies/parcel carriers offering to transport my wares, or those of any other person, free of cost.  I use USPS to ship my items and they charge me a fee based on package weight and dimensions, distance, and type of service (first class, priority, international, express). Etsy also charges me a fee of 5% of what I pay USPS for shipping.  I said this isn’t a rant, so don’t get me started on the logic of that. Just know that it’s in addition to the 5% transaction fee collected by Etsy on the price of the item sold.

My jewelry comes gift-boxed, and an item typically fits in a #0 padded envelope.  I include the cost of the gift box and envelope in the item price (adding about $1 per item in total) and do not advertise the gift packaging as being free.  The USPS rate to ship a necklace or pair of earrings via domestic first class is currently $3-5 depending on the destination. The USPS rate to ship the same item via priority mail is currently $7.35 or more, depending on destination.  That’s what USPS charges me and that’s what I charge the buyer.

Screen shot from my shop showing how Etsy marks items with “free” shipping. All of the earrings in my shop ship postage-free, meaning I cover the cost of shipping. For items not marked “free shipping” the USPS shipping charges will be displayed below the item description based on the buyer’s postal code.

I stopped offering express and international shipping about a year ago when Etsy began charging sellers a percentage of the item shipping cost.  The USPS rate for domestic Priority Mail Express starts at $25.50. The USPS rates for International Priority Mail start at $34.30 and for International Priority Mail Express is $44 and up.  That 5% fee on shipping costs that etsy collects may not seem like much until you compare it to the meager profit margin on my items. I couldn’t justify operating at that kind of loss so I turned off those shipping options.

Someone has to pay

If a seller on etsy is offering “free” shipping, it’s likely the actual cost of transportation for an item has been included in the price of the item or has been absorbed by the seller.  In the first case, where the cost of transportation has been added to the item price, that is technically ‘shipping included’ rather than “free” shipping. In the second case, it means the cost of transportation for an item comes out of the seller’s profit margin for that item.

Screen shot from Etsy with my emphasis added in yellow highlight.

As mentioned, I do offer truly postage-free shipping on some items in my shop. My average first-class shipping cost for a pair of earrings or a simple pendant on cording necklace is $3.50.  I have not included that amount in the item price. Rather, I have chosen to absorb that shipping cost and hope to make a larger sale down the road.  

Etsy has suggested sellers can “recover” their shipping costs by increasing their item prices.  I have no issue with a seller deciding to fold the shipping, handling, and any other related costs into an item’s price.  That is literally their business. And some buyers may prefer this sort of all-in-one pricing for simplicity. However, I would prefer some truth in advertising such that these pricing schemes are more honestly labeled as “shipping and handling included” by Etsy rather than deceptively calling it “free” shipping.  No, I’m not accusing any shop owners of intentionally deceiving buyers. I’m saying it’s misleading for Etsy to promote it as “free” shipping when encouraging sellers to include shipping costs in the item price.

The math doesn’t add up

For my items, there’s no easy way to include the cost of shipping that is equitable across buyers, particularly if I were to resume offering express and international shipping.  Heck, I couldn’t even get the math to work for buyers who purchase multiple items versus those who purchase a single item. (Because the shipping cost for two pair of earrings is not double the cost for one pair, so someone would get overcharged.)  So for my own sanity, I don’t include shipping costs in my item prices.

Screen shot from Etsy with emphasis added by me in blue highlight.

I have had a shop on Etsy since 2008 and it is the only place I currently sell online.  On numerous occasions and for various reasons, I have considered putting a shopping cart here on my website.  There are many factors to consider, not the least of which is it can be time-consuming to manage all that comes with e-commerce security matters. I am fortunate to have a day-job that covers my living expenses, but that means I don’t have the time (or, honestly, the mental energy) to devote to managing my own shopping cart. 

The cost of doing business

I haven’t left Etsy in protest of any of the many changes they’ve made to their platform with which I disagree.  People know Etsy as an e-commerce site and sometimes, much to my surprise, I get sales unrelated to any outside marketing efforts on my part.  Meaning those buyers found me via an Etsy search rather than my social media outreach efforts. So, I’m not here to rant about Etsy. It brings me sales on occasion, and I pay it a transaction fee in exchange.  

Do I love this latest move encouraging (pressuring?) sellers to mislead buyers about shipping charges?  No, I do not. Will I close my shop over this? No, this is not my hill to die on today. However, I do disagree with the premise and I hereby inform my customers that when you see “free” shipping for an item in my shop you can be 100% assured that what you are getting is an absolutely postage-free sales total in which the price you pay does not include my cost for shipping.  

Please support small businesses and independent artists

Let me conclude by encouraging you to continue to support small businesses and independent artisans on Etsy, whether they’ve hopped onboard the “free” shipping boat or not.  And I thank everyone who has supported my shop and hope to see you there the next time you are looking for boho art jewelry for your authentic style. 

2 thoughts on “When Shipping is Included it is Not Free

  1. Alysen

    Tammy, I just saw this post in my email feed. I’m an Etsy seller also and vascillated between offering Etsy’s FS over $35.00, only because up until June, I did offer Real Free Shipping on items over $30.00. And I usually picked up shipping costs for a limited time on the newest of my made-to-order items. However, in July, I started charging postage for previously RFS items, and found that it didn’t deter buyers.
    The cost of my Sterling Silver has gone up though and I will have to pass on that to my customers but being a fair, honest person, I will only add the actual price plus shipping from my supplier and only on the new silver bought recently at the higher price.
    Browsing thru Etsy, I’ve seen some jewelry artists who have put together components and have used the 3x or 4x retail formula. I’m shocked that they’re able to sell these pieces, but they must have a solid customer base who doesn’t shop around ..
    I assume that most shoppers on Etsy figure the ‘Free Shipping’ cost to be absorbed into the item total item price.
    In my upcoming bee collection, I haven’t yet decided if I will offer limited time R.F.S., since some items will be mostly put together components and others original or modified to my personal tastes components.

    1. Tammy Adams Post author

      Pricing is a challenge under the best circumstances. Even though I’m not trying to make a living from my jewelry (yet), I refuse to undercut artists who are by underpricing my work. However, I also don’t use the standard retail markup formulas mostly because I never intend to offer wholesale versions and therefore don’t need the price differentiation. My prices are probably close to wholesale, but I do pay myself better than minimum wage. Because i’m worth it. 😀
      You’re probably correct that many buyers assume “free” shipping means it’s included. If I could get the math to work so that no one gets overcharged, I might consider offering shipping-included pricing. But I would still object to labeling it as “free.” i’m a nitpicker about terms and words. 😉

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